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Local Government Finance update

Statement made on 22 October 2020

Statement UIN HCWS535

Statement

Following the Prime Minister‘s announcement on 12 October of new financial support for all local authorities, I wish to set out to the House how that support will be allocated to local authorities.

The allocation of this financial support, worth over £1 billion in total, consists of:

  • £919 million in further un-ringfenced grant for all local authorities;
  • £100 million package of support for public leisure services, to be administered by the Department for Digital, Culture, Media and Sport.

Government will once again be using the COVID-19 relative-Needs Formula to distribute the grant funding, as well as taking account of previous allocations. My approach also guarantees each authority gets at least £100,000 in additional funding – recognising that all areas continue to face pressures as we head into Winter. This approach will ensure the funds are distributed in a way that balances the need to support all areas across England, whilst maximising efficiency and targeting resources where they are most needed.

Un-ringfenced grant for local authorities

As with previous support, the great majority of this additional funding is un-ringfenced, recognising that local authorities are best placed to identify the specific pressures they are facing and to respond to local priorities. As with previous rounds of funding, local government should prioritise: adult social care, children’s services, public health services, household waste services, shielding the clinically extremely vulnerable, homelessness and rough sleeping, domestic abuse, managing excess deaths and support for re-opening the country.

The grant funding also includes an amount from the Department of Health and Social Care’s PPE fund to support councils in relation to PPE expenditure.

Package of funding for leisure centres worth £100 million

To address the ongoing challenges council leisure centres are facing, the Department for Digital, Culture, Media and Sport will introduce a new £100 million fund to support centres which are most in need. This complements the existing Sales, Fees and Charges scheme established by the Government which supports leisure centres run directly by local councils. Further details on the scheme will be set out in due course.

Overall position

This brings the total direct funding provided to councils through this pandemic to £6.4 billion, comprising £4.6 billion in un-ringfenced funding, £1.1 billion from the Infection Control Fund, £300 million to support Test and Trace as well as funding allocated to councils from the new Local Alert Level system and a number of grants to support communities and vulnerable people.

The funding announced today is in addition to the up to £465 million that the Government has already announced for local authorities moving up to a higher local alert levels - this will ensure that councils, working alongside NHS Test and Trace can take the additional steps needed to contain the virus.

The Government has always been clear that we will stand behind local councils, and this funding demonstrates that the Government is taking the necessary steps, so that local government can continue to fulfil its pivotal role in the response to the COVID-19 Pandemic.

Statement from

Ministry of Housing, Communities and Local Government

Linked statements

This statement has also been made in the House of Lords

Ministry of Housing, Communities and Local Government
Local Government Finance update
Lord Greenhalgh
Minister of State for Building Safety and Communities
Conservative, Life peer
Statement made 22 October 2020
HLWS528
Lords